Payment convergence system and method

ABSTRACT

A method and system is provided for convergence of multiple independent applications into a single payment vehicle. In the context of a medical procedure, the invention provides for the convergence of medical/dental insurance with at least one secondary payment source to effect payment for the entire procedure. Through the instant invention insurance benefit information can be determined and funds blocked, then secondary payment source(s) can be utilized to effect payment of the insurance co-payment amount. The use of Smart Card technology enables the convergence at the point of sale of information about multiple applications/payment sources (i.e. insurance plan and secondary payment plan) that are processed to determine the amount of payment to be received from each source.

RELATED APPLICATIONS

This application is a continuation of U.S. application Ser. No.10/217,903 filed Aug. 13, 2002, now U.S. Pat. No. 7,039,593, and whichclaims priority to U.S. Provisional Application Ser. No. 60/390,179,titled Payment Convergence System and Method, filed Jun. 20, 2002 byRobert David Sager, the entire disclosures of which are incorporatedherein by reference.

FIELD OF THE INVENTION

The present invention relates to a payment convergence system andmethod. The invention permits multiple independent payment options to bebundled into a single payment vehicle. The invention also permits theconvergence at the point of sale (POS) of information about multipleindependent payment options using Smart Card technology.

BACKGROUND OF THE INVENTION

Smart Card technology is currently in use in several industries,including healthcare, banking, entertainment and transportation. A SmartCard is a plastic card similar to a credit card, which is embedded witha computer chip that stores and transacts data between users. This datais associated with either value, information or both, and is stored onthe card.

There are two types of Smart Cards, memory cards and microprocessorcards. Memory cards do not have any sophisticated processing power andare incapable of managing files dynamically. There are three primarytypes memory cards: Straight Memory Cards, Protected/Segmented MemoryCards, and Stored Value Memory Cards. Straight Memory Cards simply storedata and have no data processing capabilities, they are analogous tofloppy disks of varying sizes. Straight memory cards do not have anymechanism to lock the data; thus anyone with a reader can access thedata stored on the card.

Segmented Memory Cards have built-in logic to control user access to thememory of the card. Data stored on such a Smart Card is protectedthrough a password or system key. Segmented Memory Cards can be dividedinto logical sections to provide for planned multi-functionality of thecard.

Stored Value Memory Cards are used for storing value or credits. Thesecards can be either disposable or rechargeable and usually incorporatepermanent security devices such as password keys and logic that arehard-coded into the chip by the manufacturer. The memory on these typesof Smart Cards is essentially set up as a counter. For example atelephone card may have twelve memory cells, one for each minute of talktime. One memory cell is cleared each time a minute of telephone talktime is used. Once all twelve memory cells are cleared, no more talktime is available and the card is either discarded or recharged withmore talk time.

Microprocessor Cards have on-card dynamic data processing capabilitiesthat permit the combination of multiple applications onto a single card.For example, a single Smart Card can function as an individual'sdriver's license, their credit card, their phone card and their healthinsurance card. These multiple-application Smart Cards are usually“co-branded” with the names of each of the individual companiesutilizing an application on that Smart Card (i.e. credit card company,phone company, health insurance company, etc).

An important feature of these multi-application Smart Cards is that theinformation relating to each individual application be kept separatefrom the other applications, and that the appropriate information onlybe available for use with its intended application. For instance, theinformation that is available to a merchant where a purchase is beingmade should only include the individual's credit card number, and shouldnot include any information necessary to make long distance phone callsor the individual's health insurance information. Each application mustbe kept separate for security and privacy reasons.

For some time now, Smart Cards have been used in the health insuranceindustry to help process and settle routine medical claims. The use ofthe Smart Cards in a health insurance application provides tremendousbenefit in being able to simplify and automate eligibility informationand co-payment information on the spot. Prior to the use of Smart Cards,a clinic's office staff would make photocopies of a patient's insurancecard and call an 800 number to verify coverage. One swipe of a SmartCard connected to an insurer's computer system can provide assurancethat the patient is eligible for treatment, the amount of the associatedco-pay, and any restrictions in the payment of fees.

Because of the importance of maintaining a separation between multipleapplications located on a single Smart Card, the prior art usage ofSmart Card technology has been a strictly “horizontal” referencing andupdating of information and instructions for each applicationindependently. Currently no system exists for “vertically” combininginformation from the independent applications of a multiple applicationSmart Card, or for “vertically” combining information from independentapplications of any other card with multi-functionality. For example, asingle Smart Card might include multiple applications such as a creditcard and a health insurance card. Theoretically, using such amulti-application Smart Card of the prior art, a healthcare subscribercould utilize both the healthcare application and the paymentapplication to allow the provider to obtain both the insurance coverageportion and the patient's co-pay portion for a procedure. Nevertheless,the provider would be required to have appropriate equipment andsecurity codes to access both applications. Additionally, the providerwould have to access each application independently, or horizontally.First the provider would have to access the healthcare application todetermine policy coverage and amount of co-payment required, and thenseparately access the payment application to obtain the patient'sco-payment. Such would require considerable time and expense to theprovider due to equipment needs, paperwork and manpower. Even more timeand resources would be utilized if a third application, such as ahealthcare line of credit account, is included on the card.

Basically the multiple-application Smart Cards (or any other cards withmulti-functionality) of the prior art act only to eliminate the need ofthe card holder to carry a separate card for each application. Usingsuch a card of the prior art, the card holder can have insurance policyinformation, healthcare line of credit account information, and creditcard information all on a single card. Unfortunately, when thecardholder goes to the doctor's/dentist's office and presents the card,the healthcare provider will be required to perform manually separatechecks for each application that is to be utilized. Once themedical/dental procedure is determined, the healthcare provider willneed to phone, fax or email the patient's insurance company to determinewhether the procedure is covered, and the amount of payment that theprovider will be eligible to receive from the insurance company for theprocedure. Once the amount of payment to be expected from the insurancecompany is determined, the provider will then have to independentlyphone, fax or email the healthcare line of credit company to determinehow much payment the provider can expect from that source. Finally, ifthe insurance company payment amount combined with the line of creditamount is not enough to cover the entire cost of the procedure, theprovider must collect the remainder of the costs from the patient. Ifthe patient chooses to pay by credit card, the provider must obtainauthorization for credit (holding against a line of credit, alsoreferred to as blocking or reservation of funds) and complete settlementof funds in the traditional manner of usage for a credit card. It wouldbe beneficial if the healthcare provider could avoid the time andexpense of performing these multiple checks independently.

Determining the amount of payment to be expected from the insurancecompany by itself can be a fairly complex procedure based upon a co-paypercentage, co-pay limits and policy limits. For example, a dentalpolicy may have a $3000 yearly policy limit. Additionally, the patient'sco-pay might be 20% up to a maximum out-of-pocket of $250. Thus, assumethe patient has already had a procedure this year that costs a total of$1000, the insurance company would have paid its 80% or $800, and thepatient would have paid its 20% or $200. Now, assume the patient needsto have a procedure for which the total cost is $2000. The insurancecompany's 80% portion would be $1600, and the patient's 20% portionwould be $400. Nevertheless, the patient's maximum out-of-pocket is$250, so the patient only pays $50 for this procedure, and the insurancecompany pays the additional $350 of the patient's portion of the co-pay.This leaves a total paid by insurance of $1950 for the second procedure,and a yearly total of insurance benefits of $2750. Now assume thepatient needs a third procedure that will cost $1000. Because thepatient has already met its yearly out-of-pocket amount the insurancecompany should cover the cost of the entire procedure. But, if theinsurance company pays the entire $1000, it will have provided a totalyearly benefit of $3750, whereas the policy limit is $3000. Thus, theinsurance company will only pay $250 for this third procedure to give ayearly total of $3000. The patient will be responsible for theadditional $350 due for the procedure.

As complicated as the above example appears when one knows all theimportant information such as the co-pay percentage, maximumout-of-pocket, policy limit and the amount of benefits already utilizedby the patient, it becomes even more complicated, and sometimes evenimpossible, to accurately determine the amount of payment to be expectedfrom an insurance company when all of this information is not readilyavailable to the healthcare provider. Often, under the current system, ahealthcare provider will only be given part of this information, such asthe co-pay percentage and the policy limit. The provider may not haveaccess to the amount of benefits already utilized, thus making itimpossible for the provider to determine the amount of payment that canbe expected from insurance before the procedure is performed and theclaim is processed. Additionally, if the provider does know the amountof benefits already utilized at the time the procedure is performed, andthen the provider is required to submit a claim for benefits to theinsurance company through the traditional paper form channels, it ispossible that another claim could be processed and paid before theprovider's claim but after the provider determined the amount ofbenefits utilized. Such would change the amount of benefits utilized,and could reduce the amount of payment made to the healthcare provider.Thus, it would be beneficial if the healthcare provider could determinethe amount of benefits utilized and the amount of payment expected fromthe insurance company prior to performing the procedure. Additionally,it would be beneficial if the provider could obtain authorization forfunds with the insurance company prior to performing the procedure toensure payment of the full amount determined to be expected.

OBJECTS OF THE INVENTION

A principal object of the present invention is to provide a paymentconvergence system and method that assists healthcare providers inobtaining insurance coverage information about patients while alsoobtaining payment for procedures, or portions of procedures, that arenot covered by the patient's insurance policy.

Another object of the present invention is to provide a secure systemthat converges, or makes available in a single application located atthe point of sale (POS), multiple types of information including but notlimited to payment options for patient co-pay portion of a procedure,patient insurance benefit information, and third party co-payinformation.

Another object of the instant invention is to enable a provider todetermine the amount of payment to be expected from multiple independentsources, and to obtain authorization for payment from those sourcesprior to performing a procedure.

Yet another object of the instant invention is to provide a system thatallows for the creation of a new bundled product by merging a person'sinsurance benefits with pre-approved credit.

SUMMARY OF THE INVENTION

The above objectives are achieved by converging multiple independentpayment sources/options into a single payment vehicle for a singletransaction. First, a total cost for the transaction (“transactiontotal”) will be determined at the point of sale. Then informationregarding the method of payment for the transaction (“convergenceinformation”) will be obtained at the point of sale. Once theappropriate convergence information has been obtained, a processing thatutilizes the convergence information can be performed to determine theamount of payment to be received from each payment source to satisfypayment for the transaction total. Payment can then be collected fromeach payment source in the amounts determined.

As the object of the invention is to obtain payment from multipleindependent sources, current Smart Card technology serves as aconvenient medium for storage of information regarding the paymentsources. Information about multiple payment sources can be stored atdifferent locations on the same Smart Card. Nevertheless the convergenceinformation can be contained in numerous forms contemplated by the priorart. For example, it may be possible to maintain convergence informationon a magnetic strip card or even in the form of a number. Convergenceinformation in the form of a number would be similar to that of avehicle identification number, wherein the location of a digit in anumber has significance.

Convergence information can include data, processing instructions, orboth data and processing instructions. The data can include informationabout the payment sources with which the party attempting to makepayment has a relationship (“primary payment source information” and“secondary payment source information”), such as contact information forthe payment sources, member identification numbers, policy terms, creditlimits, etc. The instructions can include information establishing theinterrelation and interaction between the multiple payment sources.These instructions can include such information as the order forutilizing the various payment sources, and the timing of utilizing suchsources. Convergence information does not necessarily include allinformation about the payment sources. In such a situation the data(convergence information) held on the Smart Card will be used as the“key” for data lookup via “Host Networks” of the payment sources.

The foregoing and other objects are intended to be illustrative of theinvention and are not meant in a limiting sense. Many possibleembodiments of the invention may be made and will be readily evidentupon a study of the following specification and accompanying drawingscomprising a part thereof. Various features and subcombinations ofinvention may be employed without reference to other features andsubcombinations. Other objects and advantages of this invention willbecome apparent from the following description taken in connection withthe accompanying drawings, wherein is set forth by way of illustrationand example, an embodiment of this invention.

DESCRIPTION OF THE DRAWINGS

Preferred embodiments of the invention, illustrative of the best modesin which the applicant has contemplated applying the principles, are setforth in the following description and are shown in the drawings and areparticularly and distinctly pointed out and set forth in the appendedclaims.

FIG. 1 is a pictorial illustration of a multiple application Smart Cardof the instant invention.

FIG. 2 is a diagram showing the vertical and horizontal convergence ofmultiple applications of the instant invention.

FIG. 3 is a flowchart showing one possible embodiment of the instantinvention that utilizes an insurance benefit application and a firstparty/patient payment application.

DESCRIPTION OF THE PREFERRED EMBODIMENT

The instant invention provides a system that allows for interrelationand interaction of multiple applications of a single Smart Card (orother data storage medium) to perform a complex processing and adistributed processing of all the information stored in the variousapplications of the Smart Card.

Although the preferred embodiment of the inventive system is illustratedin the context of a dental insurance plan, the instant invention can beapplied to any form of medical coverage and performance of medicalprocedures, or even any other situation in which multiple independentapplications must be utilized to accomplish a single outcome. Forexample, the instant invention could be applied to the purchase of avehicle, which often requires financing approval and payment from abank, as well as partial payment or money down from the purchaser.

In the preferred embodiment, a dental patient will have a Smart Cardthat includes information contained on the patient's insurance card, butalso includes information that is not normally contained on an insurancecard. The card of the instant invention will be generally referred to asa convergence card. The convergence card will include the patient'spersonal information such as name, address, PIN, etc. and the patient'sdental insurance information, such as plan identification number,insurance company contact information (or a link to the insurancecompany), insurance eligibility, plan information and insurance status(i.e. amount left to reach policy limits or co-pay maximums, etc.).Along with insurance information, the Smart Card will also haveinformation about the patient's desired method to affect payment of thepatient's co-pay obligation (first party payment method). The patient'spreferred payment method could be a credit card, debit card, check,electronic benefits transfers (EBT), gifts, loyalty or prepayments. TheSmart Card can also include information about third party payments suchas insurance settlements, government assistance and private credit.

FIG. 1 shows a pictorial illustration of a multiple application SmartCard of the instant invention. To better illustrate the instantinvention, In FIG. 1, each application is shown as a vertical layer thatis stacked on the Smart Card. Although the information stored on theSmart Card of the instant invention is illustrated as “vertical layers”,it is understood that the actual physical storage of information on aSmart Card can be accomplished in a single storage location with databeing stored either randomly or sequentially. Each layer contains adifferent type of information that can be used independently from theinformation of all other layers. In the illustrated embodiment there arefour layers: A) Card Holder Information, B) Insurance BenefitInformation, C) Third Party Payment Information, and D) First Party(Card Holder) Payment Information.

Card holder information includes name, address, phone, social securitynumber, and so forth.

Insurance benefit information includes insurance policy identificationinformation (account number), plan information, subscriber/patientinformation, secondary coverage information (i.e. partial coverage froma spouse's insurance policy, etc.), policy limits, co-pay percentages,eligibility information, amount of policy limits and co-pay capsutilized, and any other information relating to insurance coverage.

Third party payment information includes any insurance coverage that issecondary to the primary insurance policy, as well as any private credit(line of credit) accounts for healthcare, any cafeteria plans,governmental assistance, social security, gifts certificates, charitablegifts, prepayments, loyalty credit (i.e. credit earned for customerloyalty, similar to frequent flyer program), or any other source that isnot the primary insurance company and is not a direct payment from thepatient.

First party payment information includes any payment that is directlyfunded by the patient, such as the patient's credit card account, debitcard, check, EBT, or any other account in which the funds are controlledby the patient.

As is shown in FIG. 1, the Smart Card of the instant invention can beco-branded to include multiple applications that can be utilizedindependently from one another. In the illustrated embodiment, the cardis co-branded as a credit card and as a dental insurance card. Thecredit card information can be used independently from the dentalinsurance information. For example, the card holder can use the card tomake a purchase at a department store just as they would use theircredit card. The purchase will be invoiced on the card holder's creditcard statement, and not be in any way associated with the card holder'sdental insurance policy. Note that the Smart Card of the instantinvention does not necessarily contain multiple applications or have tobe co-branded (i.e. insurance card and credit card), it can be a singlemedical coverage application that includes a patient's credit card andinsurance company information as part of the patient's medical coverageinformation. For example, if the card holder's preferred payment method(first party payment) for co-pay is the patient's credit card, thepatient's credit card number and other essential information (i.e.expiration date, billing address, etc.) will be stored on the Smart Cardfor access by the dentist as the first party payment source. In such asituation, any other merchant (non-dentist) cannot access the firstparty payment information to make a traditional credit card payment.

Further note that even if the card of the instant invention isco-branded with a credit card company, or some other first party paymentcompany, use of the co-branded first party payment source is notnecessarily required by the instant invention. For example, if aninsurance card is co-branded with a credit card, the card holder mightchose an entirely different payment source, such as EBT, to effectpayment of the co-pay portion of a procedure.

FIG. 2 shows the vertical and horizontal convergence of multipleapplications of the instant invention. As is shown in FIG. 2, the SmartCard will contain multiple layers of information. As is discussed above,these multiple layers of information each contains information that isuseful to the cardholder independent of all other information containedin the other layers. For example layer B, insurance benefit information,is useful by itself to provide the dentist/medical provider withinformation about the card holder's insurance policy so that the dentistknows how and where to bill for payment for a medical procedure. In asimilar fashion, layer D, first party payment information, is useful byitself to effect payments for other purchases made away from thedentist's office. As is discussed above, the information contained ineach layer might be accessible individually for use outside thedentist's office if the card is co-branded.

In FIG. 2 it is shown how the card allows information to flowhorizontally. For example, insurance plan information can flow from theinsurance provider to the dentist as is already done in the prior art.Additionally, as has been done in the prior art of credit cards, etc.,authorization for funds can be obtained and settlement can beaccomplished for services provided by the dentist. FIG. 2 also shows howthe system of the instant invention allows information to flowvertically. As is shown in FIG. 2, information from the independentapplications/layers is converged together to perform complex distributedprocessing which results in payment to the dentist for the entire dentalprocedure. The amount of insurance coverage can be determined along withthe amount of any third party payments and then the amount of co-paythat must be paid by the patient. Payment can then be collected from allsources—insurance company, third party and patient.

The instant invention involves multiple relationships which are allcentered around a Smart Card. The Smart Card stores information aboutrelationships that exist between the card holder and financial serviceproviders such as the dental insurance company, first party paymentcompanies, and third party payment companies. The card holder/patienthas a relationship with the dental insurance company in the form of theinsurance plan (subscriber contract), wherein the insurance companyagrees to pay for certain dental procedures performed on the patient.The patient also has relationships with the first party paymentcompanies and third party payment companies as a customer throughcredit/debit accounts, checking accounts or other similar paymentmethods. These relationship provide that the payment companies will makepayments on behalf of the patient as a payor in the amounts desired tothe persons desired by the patient.

The Patient and dentist have a relationship wherein the dentist is toperform a dental procedure on the patient in exchange for payment. Theinformation about the relationships between the patient and thefinancial service providers enables relationships between the dentistand the financial service providers. The dentist uses the informationstored on the Smart Card to contact the financial service providers toobtain payment from the financial service providers on behalf of thepatient. As is shown in FIG. 2, the dentist's office and the financialservice providers exchange information and payment through theassistance of a Processor. The Processor has relationships with thedentist, the first party payment companies, the third party paymentcompanies, and the insurance company. The Processor of the instantinvention can either be a single entity that has relationships with allrelevant parties, or alternatively, the Processor of the instantinvention can actually comprise multiple Processors each havingrelationships that assist in enabling the relationships between theparties. For example one Processor may act as a clearing house fortransferring payment information between the first party payment companyand the dentist. A separate Processor may act as a clearing-house fortransferring information between the dentist and the insurance company.An indirect relationship exists between the patient/card holder and theProcessor wherein the patient is a beneficiary of the relationshipsbetween the other parties and the Processor. It is also possible thatthe relationship between the dentist and the insurance company (or otherfinancial service providers) can be accomplished through a direct lineto those companies rather than through a Processor.

As is discussed above, the Smart Card contains all the information aboutthe patient (i.e. name, address, etc.) and the patient's relationshipswith the insurance company, the banks and any third party (i.e.healthcare line of credit) payment companies. This informationessentially enables the relationships between the dentist and theinsurance company, and the dentist and the first party payment company,etc., and allows for the transfer of information between these parties.Initially, all this information provides the dentist with basicinformation about the patient to allow the patient to initiate arelationship with the dentist. After the relationship is initiatedbetween the patient and the dentist, the Smart Card provides the dentistwith updates of all essential information. The updated information canbe information stored on the Smart Card, information transmitted to thedentist's office from the insurance company (or bank or other financialservice provider) in a transmission enabled by contact information onthe Smart Card, or a combination of both. The Smart Card provides thedentist with information necessary to contact (through the Processor)the insurance company, third party payment company, and first partypayment company to make a sequence of inquiries and answers.

Examples of inquiry and answers between the dentist and the insurancecompany, third party payment/credit company and first party paymentcompany include: identification of the patient and the patient's accountwith each respective company; verification of information on the SmartCard, predetermination of eligibility for benefits/payment,authorization for payment, issuance of payment and update of informationabout the patient and its relationships.

The POS terminal at the dentist's office may access the Smart Card inseveral phases, first to set up a patient's account and update patientinformation about the dental plan, the private credit plan (third partypayment method) and the first party payment method. The dentist willalso access the Smart Card via the POS terminal to predetermine whatbenefits will be obtained from each source for a specific procedureprior to treatment and establish the relationships between the dentistand the insurance company and other payment companies based upon thepatient's prior relationships. The dentist can then perform thetreatment, and bill for services. If additionally services are requiredthat were not anticipated initially, the dentist can again use the SmartCard to predetermine what benefits will be obtained from each sourcebefore performing the additional procedure. Once the procedure iscomplete the dentist will use the Smart Card information to obtainpayments from all sources in the respective amounts that werepredetermined. Payments can be submitted directly from the paymentsources to the dentist (or the dentist's bank account).

The flowchart of FIG. 3 shows one possible embodiment of the instantinvention as it is implemented at a dentist's office utilizing twoapplications/layers, insurance and first party (patient) payment. Thisembodiment shows a series of inquiries and answers that might betransmitted through the instant invention. In step 10 the patient goesinto the dentist's office for treatment and initially presents the SmartCard to the dentist who has appropriate equipment to read theinformation contained on the card (POS machine). The dentist will insertor swipe the Smart Card and check to see if dental insurance planinformation is available on the Smart Card in step 20. If the Smart Carddoes not include dental insurance information, the patient will select anon-insurance payment method in step 30. If the appropriate paymentinformation selected by the patient is available on the Smart Card, thatinformation will be accessed by the dentist's POS device in step 40, andthen payment will be effected to the dentist in step 50 through aProcessor using the patient's payment information.

If the patient's Smart Card does contain dental insurance information,that information will include a dental plan Identification information,such as an identification number. In step 60, the dentist's Smart Cardreader (POS device) will send the patient's dental plan Identificationinformation to Processor. The Processor then contacts the patient'sinsurance company in step 70 to verify and update the data contained onthe patient's Smart Card, and to obtain additional insurance informationnot provided on the Smart Card, such as policy limits. In step 80 theProcessor will send the data obtained from the insurance company back tothe dental office. The POS device at the dentist's office will thendetermine whether the desired dental procedure is covered by thepatient's dental insurance in step 90. If the procedure is covered bythe patient's insurance, the amount of coverage and the co-pay amountrequired to be paid by the patient will be determined in step 100. Inthe preferred embodiment this will be done by an automated systemthrough the POS terminal. Alternatively, this step can be accomplishedmanually by the dentist and patient, or automatically on the Smart Carditself, if appropriate processing capability is available.Alternatively, the insurance company can determine the amount of co-payrequired by the patient and transmit that amount to the provider. Thepatient's co-pay will be obtained through steps 40 and 50 discussedabove.

In step 110, the dentist office will obtain authorization for the amountof insurance funds to be used for the patient procedure to be performedby the dentist. This will ensure that policy limits are not exceededbefore the procedure is complete, and that the amount of co-pay requiredby the patient does not change.

In step 120, the dentist's POS device will use the patient's informationstored on the Smart Card to file a claim with the insurance company.This claim can be filed electronically through a Processor (this is themost efficient use of Smart Card technology) or it can be printed andfiled in the more traditional paper format. In some cases the claimmight be filed electronically with a Processor that prints the claim andfiles the claim with the insurance company in paper format. The claimwill usually be filed after the dental procedure is complete, whichmight be at the same time as the funds are authorized in step 110, or itcould be several days/months later. It does not matter because the fundsare already blocked, and the co-pay amount will not change. In step 130the insurance company recognizes the claim and authorizes payment. Thiscould be accomplished electronically or through more traditionalmethods.

Note that the Processor contacted to obtain payment using the patient'spayment information (i.e. the patient's credit card in step 50) may be aseparate Processor than the one contacted to obtain insuranceinformation in step 60.

It is understood that a significant benefit of this instant invention isthat the complex distributed processing between the multiple independentapplications of the Smart Card is accomplished at the point of salelocation, thus allowing the Processor to act merely as a clearing-housefor the information. Nevertheless, it is possible to conduct portionsof, or the entire, complex distributed processing at other locationssuch as the insurance company or even the Processor (or some othercentral clearing-house location) without departing from the spirit andscope of the instant invention.

The Smart Card of the instant invention can be either a memory card or amulti-function, microprocessor card. It is even possible that a magneticstrip could be used to store information instead of, or in combinationwith the chip of a Smart Card, or that some other combination ofmultiple data storage devices may be used. If a memory card (or someother storage medium without a microprocessor) is used, the complexdistributed processing discussed above will probably take place at thePOS device. Nevertheless, the information stored on the card (or otherdata storage medium) will act as the hub (intersection, junction, nexus,node) for this distributed processing. The information located on thecard permits all necessary information, such as insurance policyinformation and patient's credit card information (for patient's portionof co-pay) to be collected at a single location (whether actuallycollected on the card, at the POS device or from the Processor's system)so that the determination of payment allocation can be made at thatlocation. This processing allows information to be gathered frommultiple sources (insurance company, credit card company, etc.) withoutany co-mingling of information between the sources. The information isonly co-mingled at the location where the distributed processing takesplace, which is where all the collected information is needed.

An important aspect of the instant invention is the fact that multipleforms of payment for a procedure are merged or bundled into a singleproduct. Essentially, the instant invention allows the card holder'sinsurance benefits to be combined with their credit card (or otherpreferred payment vehicle) into one simple payment mechanism. Thecardholder is essentially empowered by knowing up front how much aprocedure will cost the patient out-of-pocket and that payment for theentire procedure can be accomplished. The patient and dentist both knowthat payment will be made because credit has been pre-approved from allpayment sources.

Although the instant invention has been described in the context ofhealthcare (dental or medical), it is understood that the merging ofmultiple forms of payment into a single payment vehicle can be appliedto numerous applications outside the healthcare industry.

The Smart Card technology provides security to the card holder that isHIPPA compliant using such features as PIN codes, firewalls, specialcodes, and infinite rolling codes. Transmission of data from the POSdevice will be secure either by using a private network (Processor),encryption of data, or point to point networks. Communication methodscould include telephone lines, wireless technology, DSL, cable modemsand the like.

In the foregoing description, certain terms have been used for brevity,clearness and understanding; but no unnecessary limitations are to beimplied therefrom beyond the requirements of the prior art, because suchterms are used for descriptive purposes and are intended to be broadlyconstrued. Moreover, the description and illustration of the inventionsis by way of example, and the scope of the inventions is not limited tothe exact details shown or described.

Certain changes may be made in embodying the above invention, and in theconstruction thereof, without departing from the spirit and scope of theinvention. It is intended that all matter contained in the abovedescription and shown in the accompanying drawings shall be interpretedas illustrative and not meant in a limiting sense.

Having now described the features, discoveries and principles of theinvention, the manner in which the payment convergence system and methodis used, and advantageous, new and useful results obtained, the new anduseful elements, arrangements and combinations, are set forth in theappended claims.

It is also to be understood that the following claims are intended tocover all of the generic and specific features of the invention hereindescribed, and all statements of the scope of the invention which, as amatter of language, might be said to fall therebetween.

Having thus described the invention what is claimed as new and desiredto be secured by Letters Patent is as follows:
 1. A payment convergencesystem comprising: a portable storage medium; a primary payment sourceinformation stored on said storage medium; at least one secondarypayment source information stored on said storage medium; and aconvergence information stored on said storage medium, said convergenceinformation comprising instructions readable by a point of sale terminalaccessing said storage medium while said storage medium is located atthe location of said point of sale terminal, said instructions beingused by said point of sale terminal for determining appropriatecombination and order of utilization of said primary payment sourceinformation and said secondary payment source information to provide asingle payment vehicle by communicating electronically through saidpoint of sale terminal with said primary payment source and said atleast one secondary payment source, such that payment is obtained bysaid point of sale terminal by determining at said point of saleterminal a primary payment amount to be collected from said primarypayment source and at least one secondary payment amount to be collectedfrom said at least one secondary payment source.
 2. The system asclaimed in claim 1 wherein said instructions are stored as data on saidstorage medium.
 3. The system as claimed in claim 2 wherein at least aportion of said instructions are contained on said storage mediumthrough the significance of the storage locations of said primarypayment source information and said at least one secondary paymentsource information.
 4. The system as claimed in claim 3 wherein at leasta portion of said instructions are stored in a point of sale terminal.5. The system as claimed in claim 2 wherein said storage mediumcomprises a Smart Card.
 6. The system as claimed in claim 1 wherein saidinstructions comprise instructions for first processing said primarypayment source information to determine a primary payment amount andthen processing said at least one secondary payment source informationto obtain payment of a secondary payment amount which comprises aremainder of a transaction total due after payment of said primarypayment amount.
 7. A method of providing payment for transactioncomprising the steps of: storing primary payment source information andconsumer credit instructions on a portable storage medium, said consumercredit instructions including order information; determining atransaction cost; obtaining said primary payment source information andsaid consumer credit instructions from said storage medium via a pointof sale terminal while said storage medium is located at the location ofsaid point of sale terminal; utilizing said order information todetermine an order for utilizing said primary payment source informationand information regarding a consumer credit vehicle; analyzing by saidpoint of sale terminal a primary payment amount to be provided by saidprimary payment source for the transaction and a remainder; andassigning electronically for payment the remainder amount to saidconsumer credit vehicle through said point of sale terminal byutilization of said consumer credit instructions, such that payment isobtained by said point of sale terminal by determining at said point ofsale terminal a primary payment amount to be collected from said primarypayment source and at least one secondary payment amount to be collectedfrom said consumer credit vehicle.
 8. The method as claimed in claim 7wherein said consumer credit vehicle is selected from the groupconsisting of a first party payment source, a third party paymentsource, and any combination thereof.